Market in Chaos: When to Buy?

With automotive bail outs, bankruptcies, government takeovers and dealership closings it is difficult to decide whether or when to buy. Should you buy now or wait for possible price reductions as inventories pile up with dealership closings? Will used car prices be affected?

Let's share ideas and strategies here and try to make some sense of the turmoil.

Looking ahead, I don't see a lot more price reductions or incentives, except for the DOA brands. Pontiac, Hummer, Saturn.With the GM and Chrysler factories closed during their BK there aren't any more cars being pumped into inventories.For the other automakers, they have been dealing with slipping sales for a year now. They have all adjusted production downward. Credit continues to be the biggest issue. Banks are tightening up on how much they lend and to whom.

Used car wholesale prices have been going up on certain model segments that were previously depressed, such as SUV's and sports cars. Fewer new car sales and fewer short term leases will mean shortages of late model low mile cars in the next couple of years. UC buyers may have to look at older models since there won't be so many 2-3yr old cars on the market.

a used convertable. I am thinking November? as dealers want to move?. Or is it better say Mid Jan/ Feb when NO ONE is looking (or are they??) at them?As a dealer is there a time they dump convertables, and say stock up on 4x4?Thanks

I am in NE, and thought it was going to be this spring, but looks like next spring, thinking a used 2008 or 009, they seem about the same and well sorted out , no bad news opn the roof/ car as far as I can see.Thanks, I love your posts and insight into the industry.

I disagree, Max. Hardly anyone "needs" a new car given that you could make do with used iron, cabs and/or public transportation.

If savings now were so large that you could pick up a real bargain compared to what a car might cost in a couple of years this might be a great time to trade in a car that is till serviceable for a good deal on a brand new one or perhaps a really cherry CPO.

For example my MIL's 2000 Buick is still serviceable but aging rapidly and she can easily afford a new mount. As her primary driver (she's 92) I think she ought to look into something newer but as you know a bench seat Buick LeSabre was obsolete the day she bought it.

I disagree, Max. Hardly anyone "needs" a new car given that you could make do with used iron, cabs and/or public transportation.

Unless you live in Manhatten, cabs and public transport are hardly efective for most people.There are good economic reasons to buy a new car over a used one. Warranty, longevity, better safety and technology.In your example, replacing a 10 yr old car with a new one is a good idea. You probably "need" a new car. Someone who doesn't need a new car would be someone who bought a car a year or two ago and just doesn't like it, is upside down, and wants to trade. Too many people go for the "deal" rather than the substance of the car.

I totally agree.You need one if:Your current car is agingYour current car is losing its market value fastYour lease is upYour current car doesn't do the jobYou don't have a car

At any given time, no matter what economy is like - ther a deals on slow selling cars, and bestselllers will not have deals.For example, where I work - you can always get a deal on an Audi Q7 - before the recession, during and after. On another hand - Audi Q5 is hard to get, and there are no discounts. People want to buy it, but compalin that there are no incentives, like on Mercedes GLK, and we always say - there are no incentives because you are here tryign to buy a Q5, not at a Benz dealer, trying to buy a GLK.

until your old ride falls apart. There really isn't much chance to shop for a good deal if you have to have a car right away and your trade-in has a busted gearbox , been there, done that and it sucked.

i bought my used 05 impala 3 years ago($20,000 canadian)and still have roughly 2 years on my loan($9,100 canadian) and i was contemplating a new vehicle purchase. Is this a bad idea? I mean im not overjoyed with my current vehicle but it hasnt let me down either(sides the brake rotors ><) , the main reason i want a new one because deals have never been better,the fiance rates, and rebates ect ect. Would it be smarter just to wait the 2 years or buy the perfect vehicle for my needs?

I wanted to trade it in for a midsize suv or a pickup or maybe even a g8 just cuz of the incentives, i admit i dont know much on how these deals work but they were adverstising crew cab silverados for 27k and equinox's for 20k (prolley 09 clearouts) plus the $1000 gm loyalty is kinda a little incentive. Basically just tired of having a basic boring vehicle with little utility (big trunk but still run out of space on trips) and was hoping to upgrade into something...not so basic that i would actually enjoy and would suit my needs a little better. As for the credit i assume i have good credit but again its another area im unfamilar with . I mean even though the car would be a upside down trade in, wouldnt you get it back and then some with the current offers?

Yes the deals are there and if you feel you must get something else then by all means do it.

The amount that you're upside down will be tacked onto the new purchase loan.

You should familiarze yourself with your credit so you know where you stand by going to Equifax (online) and buying your report for about $20. Yuo can learn about your score and what you should do to improve it. The better your credit report and the score then the better rates and deals you'd qualify for.